Kazakhstan grain production is expected to bounce back following last year’s disastrous season. We are expecting large production gains for wheat, corn and barley. Nevertheless, there are risks concerning farmers’ ability to maximise returns in the harvest this year. Some farmers are believed to be short of finance after flooding the market with grains early in a bid to secure badly needed operating capital. The expected relaxation of export controls by Russia and Ukraine is likely to depress global prices at a time when Kazakhstan will be looking to profit from its own surge in exports. The 2010/11 wheat harvest came in at 9.7mn tonnes, down a massive 43% year-on-year due to last year’s drought. We expect production in 2011/12 to come in at 14.1mn tonnes, though a lack of finance may hamper the harvest.

In 2011/12, we forecast barley production to bounce back to 2.11mn tonnes, with production to rise to 2.15mn tonnes by 2014/15 – down 17.3% over the forecast period due to 2009/10’s exceptional performance.

In 2010, milk production rose 1.4% to 5.33mn tonnes. In 2011, we forecast very marginal production growth to 5.50mn tonnes. Poultry production in 2010 came in at 101,000 tonnes, a year-on-year gain of 11.1%. In 2011, high feed prices will weigh on growth and we forecast production of 107,000 tonnes, up 7.0%. Demand across all Kazakh livestock sectors will be similarly robust but poultry is set to be the outperformer. To 2015, poultry demand is forecast to increase by 56.8%.

We expect bovine stock imports to have a significant effect on beef production going forward. Beef production is expected to expand by 34.7% over our forecast period, reaching 529,000 tonnes.

Industry developments:

A US$80mn project to import bovine stock from North Dakota continues. By December 15, a total of 2,040 Angus and Hereford cattle made their way to Kazakhstan. A further 2,000 are contracted to go, while negotiations are underway for a further 5,000. The new stock should have a powerful impact on the quality of Kazakhstan beef going forward.

A lack of finance may hamper this year’s grains harvest – the USDA reported that 2010’s crop failure caused many farmers to flood the market with grains immediately to gain badly needed operating capital. Farmers were also coerced into selling grains at up to 25% below market price to state grains body, the National Company Food Contract Corporation.

A lack of qualified specialists is an obstacle Kazakhstan will need to overcome if its poultry industry is to compete globally. “The poultry farms of the country are lacking veterinarians, livestock experts, technologists, laboratory assistants and accountants,” Ibragim Zhangurazov, a Kazakhstani agricultural expert, told the Kazinform news agency in January 2011. He also suggested educational institutions run training courses in poultry farming.